Memory Pharmaceuticals Corp. raised $40 million in a private financing money that will be used to fund development efforts for both its in-licensed and internal drug candidates.
Memory, of Montvale, N.J., is focused on developing drugs for the treatment of neurological and psychiatric diseases.
The company’s CEO and director, Tony Scullion, said the financing would provide Memory with “the funding to enhance our discovery engine, achieve our development targets and conclude major collaborations.”
Joanne Leonard, chief financial officer at Memory, said the financial times made the funding that much more satisfying.
“We’re excited that we hit our target in what I would consider a very difficult environment,” Leonard said, explaining that she thinks investors were intrigued because Memory is working in a very “interesting, exciting area” that includes drugs for improving memory.
Memory deficits occur not only with aging, but also with a number of diseases and conditions, including Alzheimer’s disease, schizophrenia, stroke, Parkinson’s disease, AIDS, depression, alcohol abuse and as a side effect of chemotherapy, the company said.
Leonard said the money should take the company through early 2004, noting that the company’s business development strategy is to partner with a global pharmaceutical company.
“Our strategy in general is to partner before Phase IIb, and where it makes sense to partner at [an earlier] stage, for example Phase IIa, we would do that,” she said.
Since its inception in 1998, the company has raised $77 million. It was co-founded by Eric Kandel, a Nobel Laureate, on whose findings and intellectual property Memory’s Cognistics technology platform is based. Kandel serves as chairman of the scientific advisory board.
The Cognistics platform involves designing models for memory formation using cultured cells, ex vivo brain slices and animal models. Using the models, Memory evaluates the efficacy of its internally developed compounds for lead optimization, as well as evaluates potential in-licensing candidates. Memory also uses the technology to evaluate existing drugs that may be approved for other indications, but which the company thinks may be valuable for its neurological and psychiatric diseases and disorders studies, Leonard said.
Memory expects to enter the clinic with MEM 1003, a candidate to treat central nervous system disorders, in the fourth quarter. MEM 1003 was in-licensed from Bayer AG, of Leverkusen, Germany, in September. The financial terms of the deal were not released. If things progress well, Memory plans to begin Phase IIa trials with this product by mid-2003, Leonard said. The company’s research indicates that MEM 1003 modulates neuronal calcium channels by regulating Ca2+ flow into the cell, allowing additional time to clear high levels of calcium.
Privately held Memory also is developing MEM 1414, scheduled for Phase I trials in the first half of 2003. MEM 1414 is believed to be a competitive inhibitor of phosphodiesterase enzymes, and may be used to treat mild cognitive impairment, Alzheimer’s disease and major depression, the company said.
Leonard said the funding will be used to keep a “steady state of six programs,” including research focused on nicotinic alpha 7 partial agonist, dopamine D5 receptor partial agonist, and D-serine reuptake inhibitors.
Lead investor for the funding was Biomedicine LP, an affiliate of International BM Biomedicine Holdings. Global Biomedical Partners, of New York, is the exclusive investment adviser to IBMH and represented Biomedicine LP in the transaction.
New investors were Yamanouchi Venture Capital, of Palo Alto, Calif; Mitsubishi Corp., of Tokyo; Mitsubishi International Corp., of New York; SG Cowen Ventures, of New York; Bioveda Capital, of Singapore; and Yasuda Enterprise Development Corp., of Beijing.
Previous investors participating were Oxford Bioscience Partners, of Boston; Venrock Associates, of New York; Orbimed Advisors, of New York; Alta Partners, of San Francisco; S.R. One Ltd., of West Conshohocken, Pa.; Healthcare Ventures, of Princeton, N.J.; GIMV, of Antwerp, Belgium; Medica Venture Partners, of Tel Aviv, Israel; The Invus Group, of New York; Global Life Science Ltd. Partnership, of the Channel Islands, UK; and Rho Ventures, of New York.
Bear, Stearns & Co., of New York, served as placement agent for the transaction.